Innovation Factory files for bankruptcy

HAVERTOWN -- A failed Internet incubator that had a brief life marketing a high-end ice scraper for cars has filed a bankruptcy petition and intends to liquidate its assets.

Innovation Factory Inc. filed for protection from creditors under Chapter 7 of the U.S. Bankruptcy Code, listing roughly $544,000 in assets and $1.9 million in liabilities.

"We generated good sales, but we weren't able to raise sufficient capital to continue the business," said Marvin Weinberger, the company's president.

Weinberger started Innovation Factory in 1998 with money from Infonautics Inc., one of the area's first dot-coms, which he helped found. It was based in a former school in Narberth along with Electric Schoolhouse, which Weinberger started at the same time.

Electric Schoolhouse was meant to be a national online community for students in K-12 schools across the country, along with their parents and teachers. But, despite a nationally publicized launch, it never caught on and Weinberger shuttered it to concentrate on Innovation Factory.

In late 1999, Weinberger got an online database-marketing company now called Traffix Inc. to take a 10 percent stake in Innovation Factory for $1 million. Around the same time, the incubator became home to its first company -- Circle of Learning Inc., which ran a Web site for people 50 and older.

Those events, however, proved to be the Innovation Factory's high points and Weinberger closed it, too. But he kept the name and used it for a company he started with Tucker Marion, a specialist in developing high-tech products.

According to the Innovation Factory's Web site, in March 2001, the two were on a flight to San Francisco to pitch a product to a toy company when Weinberger started complaining to Marion about the ice and snow he'd had to clear from his car before driving to the airport. By the time the flight landed, they had come up with the basic designs for what would be the new Innovation Factory's first products -- the IceDozer and SnowMover.

The two tested the products in the first few months of 2002. The following winter, Innovation Factory sold 180,000 of the products -- its entire stock. The company was projecting sales of more than $1 million for the winter just ended, but the cost of ramping up to be able to handle those sales proved too much for it.

"I put a lot of my net worth into this and I'm very disappointed, but I'll find something else to do," Weinberger said.